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Global raids target Reserve Bank firm

Nick McKenzie and Richard Baker

THE Reserve Bank is reeling after federal police and overseas agencies launched global raids last night to uncover evidence of corruption and bribery involving Securency, the RBA subsidiary that makes banknotes.

Raids in Melbourne, Britain, Spain and other countries targeted homes and offices of people with alleged links to the payment of millions of dollars in bribes by Securency to foreign officials, including politicians and bankers, between the late 1990s and 2009.

An AFP inquiry, codenamed Operation Rune, is investigating allegations that bribes were paid by overseas agents or middlemen working for Securency to win contracts to produce polymer notes for countries in Africa, Asia and South America.

Last night the AFP raided the homes of former and serving employees of Securency - which is half owned and overseen by the RBA - as well as senior staff who previously worked at the currency printer, Note Printing Australia, which is fully owned by the RBA. Six houses across Melbourne were raided.

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Britain's Serious Fraud Office simultaneously raided premises in England. Several middlemen who helped Securency win a multimillion-dollar deal with Nigeria's central bank live in or near London, while the firm's global director of sales, Hugh Brown, lives in Hampshire.

An AFP spokesman said last night that two federal agents had travelled to Britain to assist with the raids. The AFP also confirmed that the Securency probe was now a ''joint investigation'' with the Serious Fraud Office.

Over 80 members of the Serious Fraud Office, supported by officers of Surrey, Hampshire, Thames Valley, Cumbria and the Metropolitan police services executed search warrants at eight residential and a commercial site in the UK.

Two men were arrested and are being interviewed.

Two search warrants were also executed in Spain by the Spanish authorities in relation to three British nationals.

A spokesman for the British agency told The Age that officers from five British police forces helped execute search warrants.

''This action is in relation to a joint investigation … [into] the activities of the employees and agents of Securency International and their alleged corrupt role in securing international polymer banknote contracts,'' the spokesman said.

The AFP operation began in May 2009 after The Age revealed Securency had wired millions of dollars to offshore accounts linked to dubious middlemen, including some previously implicated in corrupt dealings.

Last night's raids signal the AFP is closer to prosecuting either serving or former Securency executives.

The raids will put fresh pressure on the federal government to back a broader inquiry into Securency's dealings and the extent to which they involve failings by the RBA and agencies such as Austrade, which helped select some of the middlemen.

The Reserve Bank, which has appointed half of the Securency board to oversee the firm since 1996, has been accused by former Securency employees and business experts of ignoring warning signs that the firm may be engaged in corruption.

Since 2008, Securency's chairman has been an RBA assistant governor and before that was a deputy governor.

This week The Age reported that the AFP had uncovered documents suggesting a senior trade official engaged in highly unethical behaviour to help win Securency contracts overseas.

In a separate case, a former Securency employee has previously told The Age that a consultant working for Austrade in Asia encouraged him to ''hand out white envelopes to officials'' to win contracts for the RBA firm.

Securency managing director Myles Curtis and company secretary John Ellery left the firm this year after an audit found almost $50 million had been paid between 2003 and 2009 to overseas middlemen.